A “how-to” guide for supply chain professionals who need accurate cost information for end-to-end processes
With the increasing pace of globalization, supply chain professionals find that they have less and less margin for error in their decisions making. Competition is getting more intense, and, unfortunately, CFOs and accountants do not currently provide supply chain managers with the information required to make better decisions. Supply Chain Costing and Performance Management, 2nd Edition, will show you (and the executives you report to) how to understand and apply various enterprise and corporate performance management (EPM/CPM) methods related to costs and profit margins and performance measurements.
This book is a “how-to” guide to assist supply chain managers and employee teams to obtain interenterprise cost information on supply chain processes. It provides techniques for obtaining accurate cost and performance information on the activities performed within your firm and on activities performed by trading partners. The techniques and approaches in this book were developed from supply chain costing practices implemented by leading-edge firms. You will learn how you can gain access to reasonably accurate costs and profit margins involved with suppliers, products, stock keeping units (SKUs), service-lines, channels, and customers. In addition, you will gain insight into the activity costs in end-to-end business processes, including the “drivers” for each type of cost.
- Learn how to access accurate cost and pricing information related to both your company and your trading partners
- Overcome siloed information by creating your own costing practices using proven methods drawn from leading firms
- Understand what drives activity costs for each step in end-to-end business processes
- Assess the performance of your costing activities with step-by-step measurement guidelines
- Make better decisions and improve performance and profitability with clearer, more transparent cost and price data
The information in this book will empower supply chain managers with the ability to make better decisions and improve their organizations’ performance and profitability.
Table of Contents
Preface ix
About the Authors xiii
Chapter 1: The Supply Chain Costing Journey: Why You Need to Take It 1
Chapter 2: Key Observations That Support the Development of the Book 13
Chapter 3: The Nature of Supply Chain Costing 27
Chapter 4: Developing a Foundational Understanding of Strategic Supply Chain Cost Management 45
Chapter 5: Why Supply Chain Cost Systems Differ from Traditional Cost Systems 59
Chapter 6: Overview of Cost Tools and Cost Classification 75
Chapter 7: Indirect Costs, the Influence of Cost Allocation, and the Need to Understand Activities 93
Chapter 8: The Need for Value Chain Analysis 109
Chapter 9: Customer and Distribution Channel Profitability Analysis 125
Chapter 10: Tools for Reducing Supply Chain Costs 139
Chapter 11: Supply Chain Cost Planning Tools 159
Chapter 12: Align Performance Measures with the Strategy 181
Chapter 13: Accept the Challenge of Improving Supply Chain Costing 207
Appendix: Additional Process and Productivity Tools for Supply Chain Costing 231
Index 241
